One of the properties of a trademark is that it identifies the source of the particular goods or services. The consuming public then forms an opinion of that source, whether favorable or unfavorable. Naturally, owners of marks hope that the association will be favorable and that the consuming public will come to expect a similar favorable result whenever goods are received from the source or services are provided by the source.

If the traveler has a favorable experience with a Holiday Inn, the traveler is more likely to seek out a Holiday Inn for the next stop. It goes without saying that this kind of favorable association can be the lifeblood of a hotel or motel chain. The more favorable the association between a given mark and the public perception of the source, the more jealously the holder of the mark protects it from encroachment by third parties.

The opposite can happen. The traveler could have a very bad experience with a Holiday Inn and refuse, thereafter, to stay at Holiday Inns because of that bad experience. As a consequence of this "spillover" effect, the major motel and hotel chains have rigid criteria they apply to the individual motels and hotels operating under the common name ( the individual establishments acting under the common name are said to carry the "flag" of the chain and if there is a favorable impression of the chain (the "flag") the outcome of losing the flag can be disastrous for an individual establishment).

It isn't just a question of favorable or unfavorable in general, but one of favorable or unfavorable under all the circumstances. The holder of the mark can aim for high quality at a commensurate price, acceptable quality at a low price or whatever other combination of price, quality and amenities is necessary to appeal to the market the trademark holder aspires to serve. The bottom line is that the mark is crucial in this equation. Back. Home       TM Overview       TM Case Index

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